Blood Money : Medicine: Tiny HemaCare has a potentially promising plasma technique in the fight against AIDS. But the company needs $10 million more to finish the project.

In the fight against AIDS, it’s often easier to drum up hope than money. That’s been the experience at HemaCare Corp., a small, money-losing blood-plasma products company now at a turning point in its struggle to fund research on a potential treatment for AIDS.

It’s not intended as a cure or a vaccine. The treatment involves what is known as passive hyperimmune plasma therapy. Whole plasma, the liquid part of blood that contains proteins, is taken from donors who are HIV-positive but are in the earliest stages of the disease and have healthy immune systems. The plasma is sterilized, then infused into other patients whose AIDS is further advanced and whose immune systems are failing, in hopes of slowing the disease.

Some doctors and AIDS patients, tired of waiting for a so-called magic bullet against AIDS, say anything that shows some sign of helping should be pursued. HemaCare has “got a promising HIV therapy and it’s been held up in development because the company is undercapitalized,” said Dr. Paula Sparti, a physician in Miami who treats AIDS patients. “This should go forward, and it’s not going forward clearly because of money.”

Since buying rights to the therapy--called Immupath--in 1989 from Montreal-based Medicorp Inc., HemaCare has plowed nearly $8.5 million into its development. The company has lost money four straight years, as the research costs absorbed profits from its main business of collecting plasma and platelets from donors to sell to hospitals and providing mobile treatment services for blood-disorder patients.

Last year HemaCare lost $2.5 million on revenues of $11.8 million, and through the first nine months of this year it lost another $1.6 million on revenue of $8.2 million.

And before the next and most expensive phase of research can go forward, HemaCare must persuade investors to pony up another $10 million to complete the final phase of human trials before going to the Food and Drug Administration for approval of the treatment. Meanwhile, HemaCare’s current cash reserves are only about $1 million.

Promising results from clinical trials on 220 patients in 1991 were presented to a conference of scientists in New York last month. HemaCare’s CEO Hal Lieberman concedes that a dearth of capital has slowed research, but he says the firm won’t give up. “This is too good a product to walk away from,” he said.

The company has held discussions with several potential partners, Lieberman said, although it has failed in past years to find the right partner.

HemaCare’s research has drawn the attention of hundreds of AIDS patients, including some so convinced of its merits that they volunteered as guinea pigs for the human trials, thus giving HemaCare the most precious thing they have: their time.

The therapy is based on the observation that people with the human immunodeficiency virus can stay healthy for years before their immune systems deteriorate. Investigators think the reason is that the body mounts a successful attack against the AIDS virus at first but is slowly overwhelmed. By transferring plasma from healthy, HIV-infected patients to less healthy ones, they hope to capture the antibodies produced in the early stages of infection and transfer them to patients whose immune systems are worn down.

It’s a relatively low-tech approach to the disease, and it’s certainly not a cure. But advocates speculate that Immupath could slow the progress of AIDS and reduce some of its symptoms, essentially “holding the virus in check,” explained Dr. Joshua Levy, HemaCare’s medical director, who leads Immupath research.

Because the treatment consists of infusions of proteins the body naturally produces, it’s unlikely to create the toxic side effects of antiviral drugs, such as AZT, Levy contends. And because it pools different antibodies from many donors, the treatment may stand a better chance of remaining effective despite the HIV virus’ constant mutations, he argues.

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HemaCare’s most recent study showed some encouraging results. Only one of the 21 people receiving the largest doses of plasma died during the yearlong study, while in a similar group of 21 people receiving a placebo, six died. Due to the results, all the participants are now receiving the therapy instead of a placebo and will continue even though their portion of the study has ended.

The company must now get approval from the U.S. Food and Drug Administration to go forward with testing Immupath on 400 people with AIDS. The FDA has put the approval on hold pending additional studies of the product’s safety.

Michael Dwiggins, 45, is among the HIV-positive volunteers who took part in the earlier study. His condition was diagnosed in 1990 and he was probably infected several years before. The HemaCare plasma transfusions are lengthy and uncomfortable, but “you feel quite energized afterward,” he said. Since beginning the therapy, he said, his condition has remained fairly stable.

At least two other limited studies on passive hyperimmune therapy have recorded some similar effects, although one study of advanced AIDS patients in New York recorded no great benefit.

Despite some promising results, skepticism has long dogged HemaCare’s efforts. After all, AIDS has preoccupied the world’s best scientists and biggest medical-research companies for years, and HemaCare seems an obscure and unlikely contender. Moreover, Wall Street is less than enthused with HemaCare’s recent studies. The price of HemaCare’s stock has declined more than 40% since March of this year, and closed Monday at $3.50 per share.

Although HemaCare’s approach is reasonable, antibodies are just one element of the immune system’s response to infection, said Dr. Daniel Kuritzkes, assistant professor of medicine at the University of Colorado Health Sciences Center in Denver. Many scientists think they may be among the least effective of those mechanisms, he said. Other treatments, such as hormones that stimulate the immune system and gene therapies, show more promise and may prove more economical, he said.

Critics are even more doubtful about whether wide-scale treatment of AIDS using passive hyperimmune therapy is feasible. For Immupath to work, HemaCare must have a constant stream of HIV-positive plasma donors who are willing to give plasma every few weeks.

Dr. Michael Roth, a Beverly Hills physician who treats AIDS patients with the still-experimental passive hyperimmune therapy, said the treatment appears to be beneficial but organizing a steady parade of donors for his practice is “cumbersome and time-consuming.” Donors drop out, even when they are paid, and replacements must be recruited. “This will never be a large-scale treatment. . . . You can’t mass-produce it like a pill,” Roth said.

Financial analysts also doubt that this treatment will ever be a big moneymaker for HemaCare, even if it is effective. “The issue is not, will it work? It is, will it be practical?” said Joyce Lonergan, a biotechnology analyst with Cowen & Co. in New York.

HemaCare’s Lieberman countered that organizing a national system of donor centers is exactly the sort of thing HemaCare--a blood and plasma company--does best.

“This drug will be expensive but so is getting sick,” Lieberman said, adding that the treatment could cost about $1,000 per month per patient. “What we are doing is cumbersome and expensive. . . . But there isn’t anything else.”

The company is also considering testing a related product called intravenous immune gamma globulin--in essence, a distillation of antibodies derived from human plasma. HemaCare is building a production plant in Valencia to mass-produce treated whole plasma as well as the more concentrated immune gamma globulin.

But, of course, for all this to happen HemaCare needs more money and encouraging results both in the lab and on Wall Street.